VIEWS 


William  H.  Gatzmer,  President  of  the  | | 

Camden  and  Amboy  Railroad  and  ' 

! i 

Transportation  Company,  upon  the  ! 

proposition  to  Lease  the  Public  W orks 
of  the  United  Canal  and  Railroad  ! 

Companies  of  New  Jersey  to  the  ] 
Pennsylvania  Railroad  Company,  read^ 
before  the  Joint  Board  of  Directors,  at 
their  Meeting,  at  Trenton,  New  Jersey, 

April  20th,  1871. 


3 85,14-  /'h-  ^ 

0144V  ^ 


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io 


VIEWS 


Of  William  H,  Gatzmer^  President  of  the  Camden  and 
Amboy  Pailroad  and  Transportation  Company^  \(j)on 
the  Proposition  to  lease  the  Public  Works  of  the  United 
Canal  and  Pailroad  Companies  of  New  Jersey  to  the 
Pennsylvania  Pailroad  Company^  read  before  the  Joint 
Board  of  Directors^  at  their  Meeting^  at  Trenton^  April 
mh,  1871. 


^MR.  PRESIDENT  AND  GENTLEMEN 
' ^ OF  THE  JOINT  BOARD 

Ne  should  be  actuated  by  our  convictions  as  to  wbat 
we  believe  to  be  for  the  best  interests  of  the  stockholders 
■ of  the  United  Companies,  not  for  the  present  only,  but 
for  the  present  and  future ; and  we  should  each  be  al- 
lowed to  act  freely  and  independently  upon  this  sub- 
^ject ; and  however  painful  it  may  be  for  any  of  us  to 
^differ  from  those  whose  experience,  knowledge  and 
o judgment,  we  have  always  respected  and  deferred  to 
"■  upon  other  subjects,  the  present  one  is  too  grave  and 
important  for  any  Director  to  yield  his  opinion,  and  he 
? should  not  be  reflected  upon  for  presenting  his  views 
‘ before  this  Board — nay,  more,  it  is  his  duty  to  present 
^ to  his  stockholders,  whose  agent  he  is,  the  result  of  his 
^ calmest  and  best  judgment,  and  the  reasons  which  have 
brought  his  own  mind  to  the  conclusion  it  has 
reached. 

\V.  II.  G.— 1 


i rift 


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Xo  subject  lias  ever  been  presented  for  the  considera- 
tion of  the  Directors  of  these  Companies,  of  so  much 
importance,  and  which  involves  so  much  responsibility 
in  their  action:  no  matter  which  way  they  may  decide, 
whether  to  recommend  the  acceptance  of  the  lease  or 
to  decline  it,  the  responsibility  remains. 

Upon  all  large  and  important  operations  of  these 
Companies  the  Directors  have  heretofore  been  united — 
upon  this  subject  they  are  divided. 

The  stockholders  have  committed  to  the  Directors 
the  conduct  of  their  business  and  care  of  their  property, 
and  have  selected  their  Directors  and  officers  because 
of  their  experience  and  knowledge  of  their  works,  and 
look  to  them  for  full  information  and  proper  advice 
u])on  this  subject. 

Before  making  the  submission  to  the  stockholders, 
the  Directors  should  cause  to  be  prepared  an  inventory 
of  their  property  with  valuation — a statement  of  the 
business  from  the  origin  of  these  Companies  to  the 
present  time,  showing  its  rise  and  progress,  the  increase 
of  capital  up  to  1867,  and  the  rapid  and  large  increase 
of  capital  since,  and  why  such  rapid  increase  was  neces- 
sary to  be  made  ; together  with  an  estimate  of  what  the 
future  promises  ; the  Directors  should  give  to  the  stock- 
holders every  information  concerning  their  property, 
as  regards  the  past,  the  present,  and  an  estimate  of  the 
future,  that  they  may  be  enabled  to  decide  wisely  in 
regard  to  the  value  of  their  property  and  the  franchise 
they  possess  before  parting  with  them. 

Our  works  are  invaluable  ; their  location  the  best  in 
the  United  States;  are  in  good  order  and  capable  of 
doing  all  the  business  that  will  ever  come  to  them  from 
the  South  and  West,  and  between  Philadelphia  and 
Xew  York. 

Where  one  railroad  connects  with  another  so  that 


3 


tlie  cars  can  pass  from  one  road  to  the  other  it  is  not 
necessary  for  the  public  accommodation,  or  prolit  to 
the  stockholders,  for  extensions  by  acquiring  direct 
connecting  railroads  by  lease  or  purchase ; the  usage  of 
the  whole  railroad  world  is  to  connect  with  each  other, 
and  traffic  will  seek  its  natural  geographical  channels 
from  one  State  to  another,  and  the  last  link  in  the  route 
to  the  great  metropolis  is  generally  the  most  valuable, 
as  it  is  the  final  gathering  up  of  the  traffic  of  all  the 
others.  Why,  then,  part  with  the  last  link  and  allow 
others  to  go  beyond  their  natural  territorial  boundaries? 
It  will  prove  far  more  profitable  for  our  corporation  to 
take  care  of  its  own  chartered  locality  and  cultivate 
friendly  relations  with  all  others  who  may  have  occa- 
sion to  use  our  works. 

Premature  extensions,  leases,  and  increase  of  liabili- 
ties, by  railroads,  no  matter  by  whom  encouraged,  will 
reduce  per  centage  upon  capital  invested,  as  will  be 
seen  by  an  examination  of  the  reports  of  many  of  the 
leading  railroads  of  our  country. 

There  are  examples  of  the  destruction  of  corpora- 
tions by  ill-advised  increase  of  capital — institutions  in 
which  the  retired  man  of  business,  the  widow  and  the 
orphan  had  placed  their  all,  and  were  suddenly  bereft 
of  their  income  and  rendered  destitute.  I will  only 
mention  one  with  which  we  are  all  familiar,  it  being  in 
our  midst  and  recent. 

A prouder  and  more  successful  corporation  than  the 
Lehigh  Coal  and  Navigation  Company  did  not  exist ; 
the  stock  and  bonds  were  considered  by  capitalists  the 
safest  of  investments ; their  net  earnings,  under  the 
management  of  a White,  a Ilazzard  and  a Cox,  had 
exceeded  the  legal  limit  authorizing  dividends  to  be 
paid  to  their  stockholders.  This  institution  was  com- 
mitted to  the  management  of  those  less  cautious  ; their 


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ambition  led  them  to  increase  their  capital  several  mil- 
lions in  building  a railroad  alongside  of  their  canal, 
and  the  institution  was  ruined  by  the  weight  of  its 
obligations  incurred  for  this  road,  and  the  widow  and 
the  orphan  were  deprived  of  their  living. 

The  disposition  to  increase  the  debt  and  stock  lia- 
bility of  the  United  Companies  is  improper,  when  an 
increase  of  business  does  not  warrant  it.  We  should 
keep  our  works  and  equipment  in  good  order,  and  no 
railroad  company  can  reasonably  be  expected  to  make 
improvements  faster  than  a growing  business  requires, 
and  they  should  always  be  graduated  according  to  the 
revenue. 

The  United  Companies  own  a large  and  valuable  real 
estate,  much  of  which  is  not  necessary  for  direct  rail- 
road purposes,  and  will  never  he  required  for  such,  pur- 
pose. All  such  property  should  be  disposed  of,  and  the 
proceeds  applied  to  the  liquidation  of  our  debt,  or  for 
the  purpose  of  making  such  improvements  as  the  busi- 
ness of  the  Companies  actually  needs.  Ueither  our  debt 
nor  stock  liability  should  be  increased  for  any  purpose 
whatever,  while  we  have  real  estate  or  other  property 
that  we  can  dispose  of,  without  impairing  the  facilities 
and  usefulness  of  our  works. 

In  order  that  we  may  fully  understand  our  present 
business  relations  with  the  Pennsylvania  Railroad  Com- 
pany, I will  present  some  extracts  from  the  contract 
with  the  Pennsylvania  Railroad  Company,  entered  into 
on  February  18th,  1863,  and  fully  confirmed  by  abso- 
lute lease  on  the  1st  day  of  January,  1868,  for  nine 
hnndred  and  ninety  nine  years  to  the  Philadelphia  and 
Trenton  Railroad  Company. 

2dly.  I will  read  the  minutes  of  the  Joint  Board  and 
Executive  Committee  relative  to  the  improvement  of 
Ilarsimus  Cove  property,  the  building  of  a branch  road 
from  the  New  Jersey  Railroad  to  Cornmunipaw  Stock 


0 


Yard,  and  show  the  preliminary  steps  taken  that  have 
culminated  in  an  otter  on  the  part  of  the  Pennsylvania 
Eailroad  Company  to  lease  our  whole  works  instead  of 
joining  us  in  the  improvement  of  Harsimus. 

In  order  to  secure  a part  of  the  Western,  the  South- 
ern and  Southwestern  business,  and  to  establish  a 
more  perfect  route  between  Yew  York  and  Washing- 
ton by  passing  through  Philadelphia  without  changing 
the  steam  trains,  an  agreement  was  entered  into  Feb- 
ruary 18th,  1883,  with  the  Pennsjdvania  Railroad  Com- 
pany, for  the  latter  Company  to  build  the  Connecting 
Railway,  and  to  lease  it  to  the  Philadelphia  and  Tren- 
ten  Railroad  Company  for  nine  hundred  and  ninety- 
nine  years,  at  a clear  annual  rent  of  six  per  cent,  per 
annum. 

The  contract  secures  to  the  Philadelphia  and  Trenton 
Railroad  Company  two  tracks  from  the  junction  with 
Pennsylvania  Railroad  at  Mantua  to  the  junction  with 
the  Junction  Railroad,  to  connect  South,  and  to  the 
depot  in  West  Philadelphia  for  accommodation  of  local 
business  between  Yew  York  and  Philadelphia;  so  that 
the  United  Companies  can  use  their  own  locomotives 
and  cars  between  West  Philadelphia  and  Market  Street 
Depot  and  Jersey  City  with  the  same  rights  and  privi- 
leges and  facilities  that  they  can  from  Camden  or  Ken- 
sington. 

The  contract  provides,  also,  that  the  Pennsylvania 
Railroad  Company  shall  divert  all  of  their  business 
destined  East  over  our  works,  and  after  deducting  ter- 
minal expenses,  the  receipts  to  be  divided  pro  rata  per 
mile. 

The  contract  also  provides  an  absolute  minimum  rate 
for  freight  and  passengers,  below  which  the  United 
Companies  are  not  obliged  to  go  when  competition  is 
raging  between  the  Pennsylvania  Railroad  and  other 


6 


Western  lines,  so  that  a contract  exists  providing  for 
the  United  Companies  perfect  facilities  to  carry  on  their 
Western  and  Southern  business  by  perfect  connections 
by  means  of  the  Connecting  Railway. 

The  contract  provides  for  the  Pennsylvania  Railroad 
Company  full  facilities  for  their  traffic  to  'New  York, 
without  change  of  cars  to  Jersey  City  and  South  Am- 
boy, and  the  motive  service  is  as  well  performed  as 
could,  over  the  route,  be  performed  by  their  own  direct 
agency. 

The  contract  provides  for  the  Pennsylvania  Railroad, 
facilities  at  South  Amboy,  Jersey  City,  and  Yew  York, 
all  of  which  have  thus  far  been  afforded  fully  equal  to 
the  business  they  have  given  us.  And  for  an  increased 
future  business  from  the  Pennsylvania  Railroad,  and 
from  the  Philadelphia,  Wilmington  and  Baltimore  and 
the  Baltimore  and  Ohio  Railroads,  and  other  roads, 
the  United  Companies  have  secured  ample  terminal 
property,  now  under  consideration  of  improvement, 
which  when  improved  must  fully  meet  the  reasonable 
requirements  of  all  the  Southern  and  Western  business 
that  will  ever  pass  over  this  route. 

The  contract  provides  that  if  the  Pennsylvania  Rail- 
road Company  refuses  to  properly  discriminate  in  our 
favor,  and  not  send  all  their  traffic  destined  to  the  East 
over  the  works  of  the  United  Companies,  they  shall 
pay  a sum  equivalent  to  the  net  profit  which  would 
have  accrued  if  said  traffic  had  passed  over  our  Avorks. 

The  contract  provides  equitable  running  arrange- 
ments, and  no  interference  with  our  local  or  way  busi- 
ness between  the  cities  of  Yew  York  and  Philadelphia. 

It  is  a contract  that  provides  every  needed  facility  at 
a very  low  rate  for  the  Pennsylvania  Railroad,  and  is  a 
most  valuable  agreement  for  the  United  Companies  in 
securing  to  them  the  Connecting  Railway,  by  which 


7 

they  have  a perfect  steam  connection  with  the  South 
and  West. 

The  provisions  of  the  contract  have  not  been  carried 
out  hy  the  Pennsylvania  Railroad  ; they  have  not  di- 
verted to  this  route  all  their  Eastern  business.  The 
United  Companies  have  provided  facilities  at  South 
Amboy,  and,  also,  at  Jersey  City,  to  do  their  business 
as  they  have  elected  to  do  it,  i.  e.,  their  transportation 
lines,  doing  the  business  over  the  joint  lines,  to  receive 
the  terminal  expenses  between  Jersey  City  and  'New 
York,  and  they  to  take  charge  of  the  cars  as  they  ar- 
rive at  Jersey  City,  and  to  transfer  tKem  to  Yew  York. 
Any  interruption  to  their  business  the  past  winter  was 
occasioned  hy  the  obstruction  of  ice  in  the  Hudson, 
causing  an  inability  on  the  |)art  of  their  agents  to  take 
away  the  cars  as  they  arrived  at  Jersey  City.  Their 
business  during  the  past  winter  did  not  exceed  an  aver- 
age of  one  hundred  and  fifty  cars  per  day.  We  were 
prepared  to  transfer  from  Mantua  to  Jersey  City  several 
hundred  cars  per  day. 

In  the  purchase  of  Harsimus  cove  property,  it  was 
designed  by  the  managers  to  improve  it  for  the  accom- 
modation of  the  business  passing  over  their  works  from 
the  South  and  West,  and  from  other  connections,  and 
to  meet  any  expected  increase  of  business ; but  as  our 
revenue  has  not  increased  in  proportion  to  our  capital 
expenses,  and  as  it  was  deemed  the  best  policy  by  the 
Board  of  Directors  to  keep  up  the  dividends,  it  was 
decided  not  to  go  on  with  that  improvement  imme- 
diately after  the  purchase,  and  for  a ’while  the  subject 
of  that  improvement  was  postponed,  and  no  action  had 
until  it  was  again  taken  up  in  January,  1870.  At  a 
meeting  of  the  Joint  Bqard  of  January  17th,  1870,  it  was 

Resolved^  That  a Committee  of  Five  be  appointed  to 
take  into  consideration  some  mode  of  securing  the  im- 


8 


provenient  of  the  Harsimus  Cove  propertj^,  in  accord- 
ance with  the  Eeport  of  the  General  President  of  Feb- 
ruaiy  10th,  1869,  and  report  to  the  Joint  Board  the 
most  expeditious  and  most  economical  manner  of  carry- 
ing out  the  proposed  improvements,  either  by  leasing 
to  other  companies  or  otherwise,  or  any  other  arrange- 
ment that  can  be  made  to  utilize  the  same  to  the  United 
Companies. 

Messrs.  Stockton,  Macalester,  Bradley,  Eemsen  and 
Howell  were  appointed  said  committee. 

On  or  about  the  28th  March,  1870,  Col.  Scott,  of  the 
Pennsylvania  Pailroad,  addressed  a letter  to  our  Com- 
pany upon  the  subject  of  building  a branch  railroad 
from  the  Uew  Jersey  Pailroad  to  Communipaw  Stock 
Yard. 

At  a meeting  of  the  Committee,  March  28th,  1870, 
it  was  “ Resolved^  That  the  letter  of  Col.  T.  A.  Scott, 
relative  to  branch  from  Bergen  Cut  to  the  stock  yards 
at  Communipaw,  be  referred  to  the  General  President, 
to  examine  and  attend  to.” 

At  a meeting  of  the  Executive  Committee,  April 
25th,  1870,  it  was  “ That  the  General  Presi- 

dent be  authorized  to  conclude  an  arrangement  with 
the  Pennsylvania  Pailroad  Company  for  the  building 
of  the  Branch  Pailroad  from  the  Yew  Jersey  Pailroad 
to  the  stock  yard  at  Communipaw,  each  Company  to 
contribute  in  proportion  to  their  mileage  between  Pitts- 
burg and  Yew  York.” 

At  a meeting  of  the  Joint  Board,  June  30th,  1870 
the  General  President  presented  the  draft  of  an  agree- 
ment between  the  Yational  Storage  Companj’^,  the 
United  Companies,  and  the  Pennsylvania  Pailroad  Com- 
pany, providing  for  the  construction  and  oioeration  of  a 
railroad  from  the  Yew  Jersey  Pailroad  at  the  Point  of 
Pocks  to  Communipaw. 


9 


Whereupon,  it  was  Resolved,  That  the  said  agree- 
ment he  entered  into,  and  that  the  proper  officers,  exe- 
cute the  same  under  the  corporate  seals  of  the  several 
Companies  represented  in  this  Board.’’ 

At  a meeting  of  the  Joint  Board,  July  18th,  1870, 
the  General  President  reported  that  it  was  extensively 
published  in  the  newspapers  that  the  Pennsylvania 
Pail  road  Company  was  about  to  lease  the  works  of  the 
United  Companies,  hut  stated  that  there  had  been  no 
authorized  negotiation  on  the  subject. 

The  General  President  made  a report  on  Harsimus 
Cove  improvement,  which  was  accepted  and  ordered  to 
be  tiled,  and  the  matter  referred  to  the  Committee  on 
Harsimus  Cove  property. 

At  a meeting  of  the  Executive  Committee,  December 
19th,  1870,  Gen.  Stockton  presented  and  read  a letter 
from  J.  E.  Thomson,  President  of  the  Pennsylvania 
Pailroad  Company  addressed  to  himself,  offering  to 
lease  the  canal  and  railroads  of  the  United  Companies, 
Whereupon,  it  was  Resolved,  That  the  communication 
of  Mr.  Thomson  be  referred  to  the  Joint  Board  for  its 
consideration  and  that  a meeting  of  the  Joint  Board 
he  called  for  Saturday,  the  24th  inst.,  to  consider  the 
subject  of  lease.” 

At  a meeting  of  the  Joint  Board,  December  24th, 
1870,  Mr.  Stockton  presented  and  read  a communica- 
tion from  J.  Edgar  Thomson,  President  of  the  Pennsyl- 
vania Pailroad  Company,  proposing  terms  upon  which 
he,  the  President,  thought  the  Pennsylvania  Pailroad 
Company  would  lease  the  canal  and  railroads  of  the. 
United  Companies.  Mr.  Stockton  explained  the  infor- 
mal interviews  had  with  the  President  of  the  Pennsyl- 
vania Pailroad  Company  upon  this  subject ; the  matter 
of  lease  having  been  introduced  at  the  conference  of  the 


10 


Committee  of  each  Company  appointed  to  negotiate 
about  the  improvement  of  Harsimus  Cove  property. 

After  discussion,  Mr.  Taylor  offered  the  following 
preamble  and  resolution,  which  was  adopted : 

Whereas^  A communication  from  J.  E.  Thomson, 
President  of  the  Pennsylvania  Pailroad  Company,  hav- 
ing been  read  to  this  Board,  proposing  to  lease  our 
works,  it  is 

Resolved^  That  the  officers  of  these  Companies  be  re- 
quested to  communicate  with  the  officers  of  the  Penn- 
sylvania Pailroad  Company,  and  report  to  this  Board, 
as  to  what  arrangements  can  be  made  with  that  Com- 
pany to  utilize  the  Harsimus  Cove  property,  and  to 
permit  their  trains  to  run  over  our  works ; and  also 
the  best  terms  on  which  they  will  lease  our  property, 
and  such  facts  and  figures  as  will  enable  us  to  judge  as 
to  the  advisability  of  entering  into  any  further  arrange- 
ments or  agreements  with  the  Pennsylvania  Pailroad 
Company. 

Judge  Pead  offered  the  following  resolution,  which 
was  adopted. 

Resolved^  That  the  basis  of  an}^  lease  to  the  Pennsyl- 
vania Pailroad  Company  should  be  a lease  of  our  roads 
and  canal,  and  a transfer  of  all  our  assets,  subject  to 
all  our  debts  and  liabilities  of  every  description  ; which 
are  to  be  assumed  by  said  Company.  In  consideration 
of  which  there  should  be  equal  to  a clear  yearly  divi- 
dend of  ten  per  cent.,  payable  quarterly,  secured  and 
paid  to  our  stockholders. 

At  a meeting  of  the  Joint  Board,  January  19th,  1871, 
the  General  President  communicated  the  result  of  the 
conferences  of  the  officers  with  the  President  of  the 
Pennsylvania  Pailroad  Company,  and  read  the  letters 
of  Mr.  Thomson,  President,  upon  lease  and  running 
arrangement. 


11 


After  discussion  it  was 

Resolved^  That  the  communications  be  referred  to 
the  officers  of  the  United  Companies,  and  that  thej"  be 
instructed  to  continue  the  negotiations  and  furnish  the 
information  required  by  the  Joint  Board,  and  when 
ready  to  report  that  the  Joint  Board  he  called  together. 

The  President  and  Committee  of  the  Pennsylvania 
Eailroad  asked  further  time  for  consideration,  and  at  a 
recent  meeting  of  their  Board,  there  being  no  recom- 
mendation of  the  Committee  the  matter  was  discussed 
in  the  meeting  and  referred  to  the  President,  who  made 
a communication  to  our  General  President,  not  offer- 
ing, however,  clear  ten  per  cent. 

AVe  should  not  approach  the  consideration  of  this 
subject  with  the  impression  that  our  Companies  are 
running  into  bankruptcy,  or  from  fear  that  the  Penn- 
sylvania Railroad  Company  or  any  other  party  will 
build  an  opposition  road  to  ours  betAveen  the  cities  of 
Xew  York  and  Philadelphia, 

We  are  by  no  means  bankrupt.  It  must  be  remem- 
bered that  during  the  war  for  five  or  six  years,  Ave  Avere 
obliged  by  the  rules  of  the  United  States  Government 
to  do  business  for  the  United  States,  and  which  Avas  our 
large  business  during  those  years,  the  transportation  of 
troops  and  military  stores  at  a reduction  of  thirty-three 
per  cent,  from  our  rates.  Our  works  and  equipment 
in  common  Avith  every  prominent  railroad  in  the  country 
Avere  run  doAvn  during  the  war. 

At  the  close  of  the  war,  the  consolidation  took  place, 
and  the  Joint  Board  of  Directors  by  their  By-LaAvs 
created  a neAv  organization,  appointing  a General  Presi- 
dent to  have  full  superintendence  and  direction  of  the 
affairs  of  the  several  Companies,  to  have  charge  of  the 
engineering,  mechanical,  superintending  and  accounting 
departments  of  the  whole. 


12 


After  consolidation  it  was  thought  best  and  directed 
hy  the  Joint  Board,  to  put  the  roads  and  canal  in  per- 
fect order,  and  to  improve  the  equipment  in  cars  and 
locomotives ; to  acquire  real  estate  at  the  terminus  and 
upon  the  line  of  the  roads ; to  build  station-houses 
and  bridges,  and  to  do  everything  needed,  as  the  exclu- 
sive privileges  would  cease  in  1869,  fully  to  prepare  for 
increasing  traffic,  and  so  to  perfect  their  works  and  the 
arrangements  upon  them,  that  they  might  depend  upon 
the  superiority  of  their  facilities  alone  for  protection 
against  competition. 

Our  works  are  now  in  complete  order,  roadbed,  rails, 
locomotives  and  cars,  and  everything  equal  if  not  supe- 
rior to  the  first-class  roads  in  our  country. 

These  improvements  have  cost  several  millions  of 
dollars,  and  the  traffic  has  not  increased  in  proportion 
to  the  expenditures. 

Up  to  and  including  the  year  1866,  before  the  con- 
solidation, each  Company  earned  about  twelve  per 
cent.,  paid  regular  dividends  of  ten  per  cent.,  and  had 
accumulated  considerable  surplus. 

The  gross  receipts  in  were  $8,112,107,  and  in 
1870,  $8,437,093  ; larger  in  lS70  by  only  $324,986,  while 
during  the  same  time  the  stock  basis  was  increased 
$6,163,245. 

It  has  been  said  that  the  Companies  have  not  earned 
ten  per  cent,  dividends  since  the  consolidation. 

For  the  four  years  commencing  January  1st,  1867, 
and  ending  December  31st,  1870,  the  average  earnings 
per  annum  of  the  Companies  was  eight  eighty-nine-one- 
hundredths,  a fraction  less  than  nine  per  cent,  upon  the 
capital  stock,  which  had  been  increased  during  the 
same  time  upwards  of  six  millions.  The  earnings  of 
the  last  four  years  divided  upon  the  stock  basis  of  1866, 


13 


before  consolidation,  notwithstanding  a reduction  of 
gross  receipts  of  $837,000  in  1867,  will  show  an  average 
of  more  than  eleven  per  cent,  per  annum. 

These  Companies  have  kept  up  the  dividends  of  ten 
per  cent.,  wdiile  other  ten  and  eight  per  cent,  dividend 
paying  roads  dropped  to  eight  and  six  per  cent.  The 
Companies  have,  therefore,  notwithstanding  this  ex- 
traordinary outlay  for  capital,  with  a greatly  depressed 
business  in  1867  and  1870,  been  enabled  to  keep  up 
their  dividends  of  ten  per  cent,  without  entirely  ex- 
hausting their  surplus. 

I have  known  the  I7ew  Jersey  Railroad  and  Trans- 
portation Company  when  it  paid  no  dividends ; the 
Camden  and  Amboy  Railroad  when  it  scarcely  earned 
six  per  cent.,  and  the  Delaware  and  Raritan  Canal  for 
several  years  when  it  scarcely  earned  expenses.  I have 
known  these  Companies  when  they  paid  six,  eight,  ten, 
and  twelve  per  cent.,  besides  many  extra  dividends, 
and  have  seen  the  stock  of  the  Joint  Companies  sehing 
as  low  as  fifty-nine,  and  as  high  as  one  hundred  and 
eighty  ; no  matter  what  may  happen,  my  confidence  in 
the  permanency  of  these  institutions  and  future  pros- 
perity is  firmer  to-day  than  at  any  other  period  of  their 
existence ; they  are  more  valuable  and  better  protected,* 
and  have  within  themselves  a local  and  domestic  busi- 
ness that  will  fully  sustain  them. 

It  would  be  far  better  after  laboring  so  long  to  pro- 
tect and  improve  the  works  of  the  United  Companies, 
for  the  stockholders  and  State  of  Rew  Jersey  and  her 
people  to  reap  the  advantages.  The  possession  of  tw^o 
of  the  most  direct  railroad  routes,  and  the  only  canal 
route  between  the  two  great  cities  of  the  United  States, 
the  possession  of  large  and  valuable  wharf  and  depot 
property  in  Hoboken,  Jersey  City  and  Rew  York,  South 


14 


Amboy,  Camden  and  Philadelphia,  and  a perfect  con- 
nection around  the  City  of  Philadelphia,  with  the  lines 
for  the  south  and  west,  together  with  a complete  double 
track  all  rail  route  between  the  two  great  cities.  Another 
railroad,  via  South  Amboy,  and  interested  in  one  via 
Long  Branch,  and  another  via  Pennington  and  Mill- 
stone, besides  various  branch  and  associated  Companies, 
all  pouring  in  business  upon  the  works  of  the  United 
Companies,  occupying  apparently  every  valuable  route 
across  the  State,  so  that  competition  cannot  enter  so  as 
to  very  seriously  impair  the  revenues.  Shall  we  because 
of  a present  and  temporary  want  of  great  prosperity  part 
with  these  works?  Sacrifice  them  ! Would  not  a wise 
man  say  no?  Let  us  look  about  and  bring  to  our  works 
more  business  and  change  somewhat  our  arrangements. 

In  our  connections  we  reach  the  coal  mines  of  Penn- 
sylvania, both  by  rail  and  canal.  The  increase  of  coal 
consumption  is  large,  and  it  is  now  a question  of  more 
facilities  for  its  transportation  to  the  'New  York  market. 
East  and  Yorth.  We  have  a canal  not  full,  and  rail- 
roads with  a small  business  ; let  us  immediately  make 
arrangements  for  increased  tonnage  of  coal  on  our  canal 
and  our  railroads. 

* South  Amboy  will  be  the  best  shipping-point  soon  on 
tide  for  the  coal  of  Pennsylvania.  Let  it  be  abandoned 
for  passengers  and  ordinary  freight  and  occupied  and 
used  for  coal,  iron  and  heavy  transportation,  for  which 
it  is  peculiarly  well  located,  and  a first-class  shipping 
point  for  the  Yorth,  East,  and  New  York  and  foreign 
countries. 

We  have  an  expensive  and  large  number  of  steam- 
boats and  other  vessels  necessary  to  operate  the  route 
for  passengers  and  freight,  via  Amboy.  These  are 
perishable,  and  the  expenses  to  keep  them  up  draws 


15 


largely  from  our  revenue.  As  soon  as  practicable,  let 
all  the  passenger  and  freight  business  be  done  via 
Jersey  City. 

To  secure  proper  facilities  for  the  transportation  on 
the  canal,  the  Companies  have  been  obliged  to  maintain 
a large  steam-towing  establishment  on  the  Schuylkill, 
Delaware  and  Raritan  Rivers,  to  tow  boats  and  barges 
to  and  from  the  termini  of  the  canal.  Row  outside 
parties  will  do  this  service  cheaper  than  the  Companies 
can,  and  it  should  be  given  up  to  them.  Such  an  ar- 
rangement is  now  in  operation  on  the  Delaware  and 
Schuylkill,  and  by  making  similar  arrangements  on  the 
Raritan,  including  the  sale  of  our  boats,  the  shops  at 
Hoboken  can  be  dispensed  with,  and  that  valuable 
property  sold. 

All  railroad  companies  seem  inclined  to  do  much  of 
their  own  Avork  in  building  steamboats,  cars  and  loco- 
motives, and  thereby  increase  the  number  of  their  shops 
and  workmen.  This  is  very  apt  to  run  into  extremes, 
and  railroad  companies  become  manufacturers  of  almost 
everything  they  use,  while  the  cost  is  much  greater 
than  to  purchase  them  in  the  market,  and  therefore 
railroad  companies  should  not  extend  or  multiply  their 
shops,  except  for  repairs.  A large  reduction  in  ex- 
penses may  be  realized,  by  contracting  with  parties 
outside  for  new  work,  and  thus  reduce  the  number  of 
shops  and  mechanics. 

Canals  and  railroads  should  confine  their  operations 
to  their  legitimate  business,  the  collection  of  tolls  on 
canal  and  passenger  fares  and  freights  on  railroads. 

To  place  the  works  of  the  United  Companies  in  the 
best  possible  position,  it  may  be  necessary  soon  to  do  all 
our  local  business  on  the  direct  line  connecting  at  Mon- 
mouth Junction  to  Jersey  City,  so  that  all  the  passen- 
ger and  freight  business  from  the  Camden  and  Amboy 


16 


and  the  branch  and  associated  companies  in  ^^’ew  Jersey 
from  the  South  and  the  West,  and  between  Philadel- 
phia and  'New  York,  can  be  accomodated  over  this 
route. 

It  will  he  also  necessary  to  have  Harsimus  Cove 
property  improved  and  reached  by  rail  for  an  outlet  for 
this  business,  and  to  realize  on  this  investment,  now 
dead.  Use  the  Belvidere  Delaware,  Camden  and  Amboy 
and  other  roads  in  which  the  Companies  are  interested, 
for  the  transportation  of  coal  to  South  Amboy  and 
other  points,  the  way  traffic  upon  these  roads  to  con- 
nect with  the  main  trunk  road  to  afford  rapid  facilities 
for  passenger  and  freight  by  the  all  rail  route  to  New 
York  and  Philadelphia.  This  us  what  our  present  im- 
provements are  now  capable  of  doing.  We  have 
every  connection  needed,  and  the  United  Companies 
in  their  arrangements  would  then  be  perfect,  and 
save  the  immense  expense  of  the  transfers  of  passengers 
and  freights  at  South  Amboy,  and  by  using  floats  at 
Yew  York  and  at  Camden  for  transfers,  which  is  now 
successfully  done,  we  place  our  works  almost  in  the 
same  position  as  to  facilities  and  quick  transit  of  an 
all  rail  route  into  the  cities  of  Yew  York  and  Phila- 
delphia. 

Improve  Harsimus  Cove  either  ourselves  or  in  con- 
nection with  the  Pennsylvania  Railroad,  or  the  Phila- 
delphia, Wilmington  and  Baltimore  and  Baltimore  and 
Ohio  Railroads,  or  by  an  independent  store-house  cor- 
poration. Do  away  as  fast  as  practicable  with  all 
steamboats  and  floating-stock,  except  to  cross  the 
Hudson  and  Delaware ; diminish  our  shops  and  reduce 
the  number  of  our  mechanics,  keeping  only  necessary 
gangs  for  quick  repairs ; they  to  devote  their  surplus 
time  only  to  new  work,  and  arrange  our  accounts  for 


17 


close  comparison  from  clay  to  day,  and  week  to  week, 
and  month  to  month,  and  I see  no  reason,  no  matter 
what  parallel  roads  may  be  introduced  beyond  our 
present  borders,  wdiy  the  United  Companies,  with  their 
valuable  works  and  possessions,  will  not  become  again 
in  prosperity  the  first  railroad  and  canal  institution  in 
the  United  States. 

The  public  works  of  Xew  Jersey  should  continue  to 
he  neutral,  and  .administered  impartially.  They  are  the 
great  highway  of  the  nation,  connecting  the  lUorth  and 
South  and  the  East  and  West  with  the  capital  of  the 
United  States  and  the  great  metropolis ; and  so  long  as 
the  management  holds  to  that  policy,  the  United  Com- 
panies will  continue  to  he  prosperous  and  he  protected 
hy  the  State  that  gave  them  birth,  and  has  sustained 
them ; and  the  United  States  will  have  no  reason  to  in- 
terfere with  them,  nor  with  the  domestic  affairs  of  the 
State  of  lUew  Jersey. 

Our  true  interest  and  policy  is,  to  take  the  traffic  of 
any  and  all  canals  and  railroads  that  come  to  us — the 
Schuylkill  Canal,  the  Chesapeake  and  Delaware,  the 
Lehigh  and  Delaware  Division,  the  Penusylvania  Rail- 
road, the  Baltimore  and  Ohio,  and  the  Philadelphia 
Wilmington  and  Baltimore  Railroads,  the  Philadel- 
phia and  Reading,  the  lUorth  Pennsylvania,  the  Lehigh 
Valley,  the  Lehigh  and  Susquehanna,  the  Delaware 
Lackawanna  and  Western,  and  numerous  others  that 
directly  or  indirectly  connect  with  us. 

The  business  from  the  South  is  far  more  important 
to  us  than  that  from  the  West  by  the  Pennsylvania 
Railroad,  as  will  be  seen  by  the  following  statement 
from  our  books  for  1870,  and  which  is  the  largest  an- 
nual receipt  received  from  the  Pennsylvania  Railroad 
since  our  connectioii  with  them. 

W.  II.  G.— 2 


18 


South. 

Receipts  from  passengers  from  Philadel- 
phia Wilmington  and  Baltimore,  and 
Baltimore  and  Ohio  Railroads,  (1870)..  $694,989  29 
• Receipts  from  freight  from  Philadelphia 
Wilmington  and  Baltimore  and  Balti- 
and  Ohio  Railroads,  (1870) 336,826  57 

. $1,031,815  86 

West. 

From  passengers  (West)  via  Pennsylvania 

Railroad  (1870) $244,576  00 

From  freight  ( W est)  via  Penn- 

sylvania  Railroad  (1870) 415,263  77 

659,839  77 

Difference  in  favor  of  South $371,976  09 

The  number  of  trains  run  to  connect  with  the  South 
for  passengers,  three  trains  each  way ; to  connect 
with  the  West  three  to  the  West  and  five /ro?n  the 
West. 

The  number  of  tons  moved  to  and  from  the  South, 
72,057 ; received  therefor,  $336^26.57.  From  the 
West,  398,148  tons  ; receiving  $B36',-826r5-7.  t cS 
244,291  tons  of  above  freight  from  Pennsylvania 
Railroad  produced  but  sixty-six  cents  per  ton  through, 
about  seven  mills  per  ton  per  mile. 

This  average  is  the  allowance  for  motive  power  and 
use  of  road ; the  Pennsylvania  Railroad  Company  fur- 
nishes the  freight  cam,  and  takes  the  terminal  expenses 
for  crossing  the  Hudson  and  at  Hew  York. 

There  are  no  discouragements  surrounding  the  United 
Companies,  and  they  will  continue  to  grow  in  pros- 
perity, and  their  future  will  be  as  promising  as  the 
ast,  if  properly  managed. 


19 


The  mania  for  leasing,  extensions,  and  acquiring  con- 
trol of  thousands  of  miles  of  railroads  under  one  cor- 
poration, seems  to  be  the  fashion  of  the  day  ; but  where 
it  is  done,  it  is  done  to  draw  business  to  a main  trunk, 
which  extensions  may  be  impaired  in  value  by  new  roads 
running  parallel  with  them,  and  which  may  finally  de- 
stroy the  main  trunk  itself  in  regard  to  its  profitableness. 

Our  road  between  Philadelphia  and  ^^ew  York  is  a 
main  trunk,  ourselves  controlling  the  parallel  routes. 
We  have  already  two,  and  soon  will  have  three  roads, 
when  the  Millstone  line  is  completed,  running  near  and 
parallel  with  our  main  trunk. 

Is  the  Pennsylvania  Railroad  and  its  controlled  roads 
any  more  secure  from  rivals  than  we  were?  In  the 
third  of  a century  we  have  three ; and  in  less  than  ten 
years  the  Pennsylvania  Railroad  between  Philadelphia 
and  Pittsburg  may  have  a rival,  and  all  of  the  Western 
and  Yorthern  and  Southern  connections  controlled  by 
them  may  be  duplicated.  How  then  will  they  be  able 
to  meet  their  obligations  ? 

We  need  no  extensions.  We  are  mainly  confined 
within  the  limits  of  our  own  State,  and  occupy  the 
most  enviable  railroad  and  canal  territory  in  the  United 
States,  and  should  be  cautious  in  giving  or  taking 
leases.  We  are  located  between  the  two  great  cities  of 
the  United  States,  and  join  them  together  by  both 
canal  and  railroads ; the  growth  of  population  of  Yew 
Jersey  far  exceeds  that  of  any  of  the  thirteen  old 
States,  so  that  we  can  sustain  our  works  by  the  growth 
of  our  local  business  alone,  should  we  lose  the  AUestern 
and  Southern  connections;  but  of  which  there  is  no 
danger.  AVe  are  the  direct  and  established  highway, 
and  the  business  from  the  AYest  and  South  must  pass 
over  our  works,  unless  Ave  shut  it  out  by  establishing  a 
monoply  for  a greatly  extended  institution,  which 


20 


would  use  these  public  works  to  subserve  its  own  ends, 
and  for  the  protection  of  its  own  extensions.  The 
stockholders  must  not  he  discouraged  because  their 
ship  has  made  two  unprofitable  voyages  in  the  last  fif- 
teen years,  viz.,  in  1867  and  1870 — in  1867,  occasioned 
by  the  general  depression  in  business  immediatelj^  after 
the  war,  and  in  1870,  owing  to  the  strikes  in  the  coal 
regions  mainly,  so  that  the  first  six  months’  revenue  of 
the  canal  was  largely  reduced  as  compared  with  the 
six  months  of  1869. 

By  looking  over  our  Dividend  List,  we  find  that  the 
Joint  Companies  commenced  paying  dividends  in  1833, 
and  for  that  year  paid  three  per  cent. ; in  1834  and  ’35, 
paid  six  per  cent. ; in  1836,  nine ; in  1837,  ten  ; in  1838, 
eight ; in  1840,  an  extra  in  bonds  of  eight  and  a half 
per  cent.,  and  regular  of  six  per  cent.  ; in  1841,  ’42  and 
’43,  six  per  cent. ; in  1844  and  ’45,  eight  per  cent. ; in 
1846,  ten  per  cent. ; in  1847,  eleven  ; in  1848  and  ’49, 
twelve  per  cent.  ; in  1850,  an  extra  of  twenty  per  cent, 
in  bonds,  and  regular,  ten  per  cent;  in  1851,  extra  in 
cash,  five,  and  regular,  ten  per  cent. ; in  1852,  ten,  in 
1853,  twelve  per  cent,  in  bonds,  and  regular,  eleven  per 
cent. ; in  1854  and  ’55,  twelve  per  cent. ; in  1856,  six 
per  cent,  reduction  occasioned  by  damages  paid  grow- 
ing out  of  the  Burlington  accident ; in  1857,  an  extra 
of  twenty  per  cent,  in  stock,  and  regular,  seven  per 
cent. ; in  1858,  eight  per  cent. ; in  1859  and  1860,  twelve 
per  cent. ; in  1861,  an  extra  in  stock  of  twenty  per  cent., 
and  regular,  eleven  per  cent.  ; in  1862  and  ’63,  ten  per 
cent. ; in  1864,  twenty-five  extra  dividend  in  stock,  and 
regular,  ten  ; in  1865  and  ’66,  ten  per  cent. ; and  since 
consolidation  the  United  Companies  in  1867,  ’68,  ’69 
and  1870,  have  paid  ten  per  cent. 

The  average  per  annum  from  1833  to  1842,  both  in- 
clusive, ten  years,  is  seven  and  eighty-five-one-hundredths 


21 


per  cent.  ; from  1843  to  1852,  ten  years,  twelve 
twenty-oiie-hnnclredtlis  per  cent. ; from  1853  to  1862,  ten 
years,  fifteen  and  eighty-one-hnndredtlis  per  cent.  ; 
from  1863  to  1866,  four  years,  sixteen  and  twenty- 
five-hiTodredths  per  cent.  ; from  1867  to  1870,  four 
years  under  consolidation  organization,  ten  per  cent.. 
The  average  of  thirty-eight  years  to  January  1st,  1^71, 
is  twelve  and  twenty-one-hnndredths  per  cent. 

Onr  gross  receipts  for  1870,  are  made  np  as  follows  : 

1870. 

Through  business  between  Philadelphia  and  N’ew  York, 


for  Freight  and  Passengers $2,281,757  25 

Intermediate  or  way 2,620,795  70 

Miscellaneous 619,889  36 

Delaware  and  Earitan  Canal 888,352  86 

Steam  Towing 334,642  20 


$6,745,437  37 

$1,031,815  86 
659,839  77 

1,691,655  63 

Total $8,437,093  00 

Onr  local  business  between  Philadelphia  and  Yew 
York,  which  might  be  affected  by  a rival  line  is  twenty- 
seven  per  cent,  of  the  gross  receipts.  Our  canal  and 
way  business,  which  cannot  be  materially  affected,  is 
fifty-three  per  cent.  Our  Southern  business,  which  we 
have  no  apprehension  of  losing,  is  twelve  aud  twenty- 
one-liundredths,  and  our  W estern  business  from  the 
Pennsylvania  Railroad,  which  we  may  lose,  is  seven 
and  eighty-one-hundredths  [)er  cent,  of  gross  receipts. 


South 

West. 


22 


Our  Western  business  via  Pennsylvania  Railroad,  is 
less  valuable  to^us  tban  either  of  the  other  sources  of 
revenue,  and  much  less  than  the  Southern. 

Our  Western  business  from  Pennsylvania  Railroad 
thus  far,  both  in  passengers  and  freight,  we  being 
obliged  to  grant  extraordinary  facilities,  falls  short,  I 
think,  of  paying  expenses,  its  whole  loss  would  not  lessen 
our  net  revenue. 

Total  amount  of  receipts  from  Pennsylvania  Railroad 
in  1870,  is  $659,839.  Amount  paid  to  the  Pennsylvania 
Railroad  Company  in  1870,  for  rent  of  Connecting 
Railway,  depot  accommodations,  tolls,  and  use  of  engine 
(for  transfers  between  Mantua  and  West  Philadelphia 
depot),  and  expense  of  maintenance  of  way  of  Connect- 
ing Railway  is  $289,452.00. 

The  great  depression  in  our  net  revenue  since  con- 
solidation, is  mainly  owing  to  a greater  increase  of 
capital  than  required  by  the  increase  of  business.  The 
increase  of  gross  receipts  in  1870,  over  that  of  1866, 
is  but  $324,686.00,  with  a decrease  of  net  receipts  of 
$274,295.89. 

The  Stockholders  have  become  dissatisfied,  and  the 
Board  is  petitioned  by  some  of  them  to  go  into  a closer 
consolidation. 

The  agreement  of  consolidation  entered  into  in  1867, 
provided  a unity  of  interest  and  harmonious  working 
of  the  several  corporations,  the  one  with  the  other,  and 
provided  that  the  Directors  of  the  said  Companies, 
parties  hereto  of  the  first  and  second  parts,  shall  meet  in 
Joint  Board,  in  the  same  manner  as  the  Directors  of  the 
Companies  composing  the  parties  hereto  of  the  first  part 
have  heretofore  done,  and  jointly  transact,  manage  and 
conduct  the  business  of  the  parties  hereto  both  of  the 
first  and  second  parts,  at  such  times  and  in  such  man- 
ner as  may  be  determined  by  the  said  Joint  Board. 


23 


The  Joint  Companies  alluded  to  were  managed  under 
the  Joint  Board  by  the  Presidents  of  the  Railroad  and 
Canal — -the  Railroad  was  operated  by  its  President,  and 
the  Canal  by  its  President.  The  accounts  were  kept 
separate  and  distinct  by  each,  and  dividends  were  paid 
to  the  Stockholders  of  each  upon  the  net  earnings  of 
both.  All  matters  of  increase  of  capital  and  extra- 
ordinary expenses  were  first  submitted  to  the  Joint 
Board,  by  the  President  of  the  Canal,  or  the  President 
of  the  Railroad,  and  if  their  recommendations  were 
considered  expedient  b}^  the  Joint  Board,  they  were 
adopted.  The  Presidents  felt  their  direct  accountability 
to  the  Directors  and  the  Stockholders,  and  were  always 
careful  to  incur  no  expense  that  an  increase  of  revenue 
would  not  warrant. 

Some  of  the  Stockholders  are  dissatisfied  because  they 
fear  a reduction  of  dividends,  and  recommend  a closer 
consolidation.  The  Joint  Board,  by  their  By-laws  in 
1867,  have  secured  to  them  a close  consolidation,  and 
any  further  consolidation  could  not  give  more  power  to 
one  head,  and  would  not  affect  their  interests  more 
favorably.  A reduction  of  the  number  of  Directors 
would  not  amount  to  much  financially,  and  the  change 
of  the  names  of  a few  officers  to  that  of  agents,  would 
not  lessen  their  pay  essentially,  for  the  same  service 
will  be  required,  and,  if  under  another  name,  would 
command  about  the  same  salary. 

It  is,  however,  the  Stockholders’  right  and  privilege 
to  make  such  organization  as  will  best  promote  their 
interests,  and  whatever  they  may  resolve  upon  the 
Directors  should  carry  out. 

The  Stockholders  have  elected  their  Directors  from 
time  to  time,  and  committed  to  them  the  working, 
organization,  and  care  of  their  property,  and  they 
should  faithfully  carry  out  the  trust,  and  be  careful  not 


24 


to  venture  upon  untried  experiments,  but  adhere  to  the 
old  adage,  ‘‘  Let  well  enough  alone  new  theories,  not 
already  well  proven  in  practice,  should  not  be  adopted. 

Some  of  the  Stockholders  are  under  the  impression 
that  the  working  arrangements  of  these  Companies  are 
extravagant,  because  of  so  many  officers  being  under 
pay,  and  that  the  establishment  could  be  better  and 
more  cheaply  administered  by  one  Ih’esident,  and  by 
throwing  the  whole  into  one  single  corporation. 

By  comparison  with  other  roads,  it  will  be  found  that 
as  regards  the  expense  for  officers  and  superintendents, 
that  no  road  of  the  same  number  of  miles  in  this  coun- 
try is  worked  cheaper.  They  operate,  without  includ- 
ing the  West  Jersey  and  Belvidere  Delaware  Railroads, 
two  hundred  and  fifty-one  miles  of  railroad.  We  have 
one  General  President,  two  Local  Presidents,  two  Super- 
intendents, two  Treasurers,  two  Secretaries,  three  Assist- 
ant Engineers,  and  two  Counsel. 

The  Pennsylvania  Railroad,  considered  a model  road 
in  its  arrangements,  is  three  hundred  and  fifty-four 
miles  long  ; it  has  one  President,  four  Vice  Presidents,  a 
Treasurer,  Secretary,  General  Solicitor,  General  Coun- 
sel, Chief  Engineer  of  Construction,  a General  Superin- 
tendent and  three  Assistants,  and  three  Division  Su- 
perintendents (each  having  a Division  Engineer),  two 
General  Agents,  and  thirteen  Solicitors. 

The  United  Railroad  Companies  are  worked  by  four- 
teen (14)  officials  ; the  Pennsylvania  Railroad  by  thirty- 
five  (35).  The  first  has  two  hundred  and  fifty-one 
miles ; the  latter,  three  hundred  and  fifty-four  miles  of 
road.  As  compared  with  the  Pennsylvania  Railroad, 
according  to  mileage,  the  allotment  to  the  United  Com- 
panies would  be  twenty-five  (25)  officials,  but  operated 
with  fourteen  (14), — a little  over  one-half  the  number. 

The  Canal  has  its  President,  Secretary  and  Superin- 


25 


tenderit.  The  Pennsylvania  Railroad  has  also  canals 
represented  hy  separate  and  distinct  officers,  so  that  the 
eoniparison  is  fair  upon  the  roads. 

There  is  considerable  doubt  that  a lease  will  be  made 
of  the  works  of  the  United  Companies  to  insure  ten  (101 
per  cent,  dividends,  even  if  the  Pennsylvania  Railroad 
C'ompany  should  otter  it,  as  there  is  a division  of 
o[)inion  in  the  Joint  Board  upon  the  subject : a division 
of  opinion  with  the  Stockholders,  and  a questioned  legal 
right  to  lease  the  Public  Works  of  New  Jersey  to  a 
foreign  Corporation,  so  that  the  Directors  will  have  to 
resort  to  some  other  expedient  to  satisfy  the  Stock- 
holders, and  will  have  to  so  regulate  their  expenditures 
as  to  insure  under  their  administration  ten  (10)  per 
cent,  dividends.  This,  I have  no  doubt  they  can  do  by 
cutting  offi  certain  expenses  and  procuring  additional 
business  now  offering. 

With  regard  to  the  State  of  ISTew  Jersey,  its  State 
Directors  being  here,  it  is  not  proper  for  me  to  discuss 
[)arlicularly  her  rights  and  interests.  I will  only  allude 
to  her  great  interest-  in  our  works,  and  thus  show  the 
great  res[)onsihility  devolving  upon  them  in  their  action 
upon  the  subject  of  lease. 

Pesides  a direct  interest  in  the  stock  and  bonds  of* 
the  United  C'ompanies  she  is  interested  in  a revenue  tax 
c([ual  to  a capital  at  six  per  cent,  of  about  $5,000,000, 
and  a stock  and  bond  interest  of  another  million,  in  all 
about  $0,000,000  dollars,  equal  to  one-sixth  of  the 
whole  capital  of  the  United  Companies.  She  derives  an 
annual  revenue  from  the  canals  and  railroads  of  the 
State  of  $500,000,  more  than  three-fourths  of  which 
IS  i)aid  hy  the  United  Companies.  She  will  there- 
fore naturally  feel  great  concern  about  the  future 
control  of  her  public  works,  and  no  matter  how  the 
Stockholders  in  general  may  decide  as  to  what  they 
mav  think  best  for  their  interests,  the  voice  of  the 
W.  H.  G.— 3 


26 


State  will  be  potential,  for  she  has  created  and  fostered 
these  Public  Works,  and  must  be  looked  to,  to  sustain 
them. 

I object  to  lease  these  works,  because  the  offer  falls 
far  short  of  what  these  works  will  produce  to  the  Stock- 
holders. 

^Tow,  in  conclusion  let  me  sa}^,  that  the  Public  Works 
of  our  Companies  originated  with  patriotic  Jerseymen, 
who  always  avowed  that  the  interests  of  'New  Jersey, 
and  the  welfare  of  her  people,  were  the  peculiar  and 
primary  objects  of  their  enterprize.  How  zealously 
and  how  faithfully  was  their  vigilance  exerted  to  pro- 
tect those  interests  ! With  what  energy  did  they  con- 
tend against  speculators  to  induce  New  Jersey  to 
tarnish  her  honor,  hy  violating  her  compact  with  the 
Companies!  With  what  exultation  did  they  always, 
contemplate  the  rich  legacy  which  they  would  transmit 
in  these  works  to  future  generations  of  Jerseymen  ! 
The  protection  of  the  interests  of  New  Jersey,  identi- 
fied with  those  of  the  Companies,  was  the  chief  object 
of  their  attention,  to  the  last  hours  of  their  useful  lives 

There  is  one  venerable  survivor  of  those  patriotic 
brothers,  who  were  the  Fathers  of  our  Companies. 
There  he  sits,  his  head  gray  with  years  devoted  to  their 
service — but  his  gray  hairs  will  go  with  sorrow  to  the 
grave,  should  you  commit  to  foreign  hands  the  interests 
of  these  Companies,  and  intrude  the  stranger  in  his 
place. 


3 0112  053 


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